swagvalance

Starbucks: Two Years of Missteps and an Overdue Admission

I have to believe Ken G is being disingenuous here when he writes, "you cannot find better espresso, cappucino, lattes, or coffee anywhere else". Maybe compared to Starbucks' fast-food bretheren, but therein lies the rub: that is precisely what they've become.

The quality mantra has been Starbucks party line for decades. Problem is, and Schultz has even admitted it, the company sold out its market leadership in quality to chase after store growth at all costs. And that meant spending the past decade automating everything they did well to use push-button vending machine-style espresso machines, enabling them to hire lesser and lesser skilled baristas to keep the doors open on these exploding number of shops, etc. Meanwhile, the competition has eaten away all their credibility at the quality end: Peet's, Tully's, Caribou, and an armada of new independents that run circles around all of the big chains.

The result? There are annual barista competitions all over the world, and yet not a single Starbucks barista can even compete -- because their dumbed-down equipment and dumbed-down hiring standards to operate it prevent it from even being possible.

Starbucks cannot trumpet the "quality" line anymore without sounding as hollow as their investor relations materials.